LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 7015 NOTE PREPARED: Dec 31, 2024
BILL NUMBER: HB 1277 BILL AMENDED:
SUBJECT: Regulation of Child Care Centers.
FIRST AUTHOR: Rep. Manning BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
XDEDICATED
FEDERAL
Summary of Legislation: The bill allows a provider to remain eligible to receive a voucher payment until
a final determination is made that the provider's license or eligibility is no longer in good standing. It also
provides that a child care center is exempt from licensure if the child care center complies with all of the
requirements for child care ministries, including registration. It makes conforming changes.
Effective Date: July 1, 2025.
Explanation of State Expenditures: The bill could minimally reduce the administrative expenditures for
the Family and Social Services Administration (FSSA) administration of licensed child care centers.
However, FSSA currently has three emerging provider specialists who assist with the needs of new providers
and would most likely be needed to transition child care centers from licensing to the requirements of the
registry.
Additional Information - The federal Child Care and Development Fund (CCDF) program requires minimal
health and safety standards incorporated into licensing requirements or separated for providers who are
license-exempt. The CCDF program requires enforcement actions to gain compliance with the health and
safety requirements. As of September 2024, there were 778 licensed child care centers with a total capacity
of 85,821. Year-to-date as of September 2024, FSSA had received 802 complaints, 421 CPS complaints, and
134 injury reports. Five child care center licenses had been revoked year-to-date, and there were no other
enforcement actions.
Explanation of State Revenues: Child care centers that choose to register rather than be licensed will
increase revenues to two funds that do not revert to the state General Fund. Child care ministries pay a $50
registration fee, which is deposited in Family Resources Child Care Fund, as well as a $50 processing fee
for the State Fire Marshal, which is deposited in the Fire and Building Services Fund.
Explanation of Local Expenditures: Locally owned child care centers would have increased registration
and state fire marshal fees if they choose to register rather than be licensed.
HB 1277 1 Explanation of Local Revenues:
State Agencies Affected: Family and Social Services Administration.
Local Agencies Affected: Locally owned child care centers.
Information Sources: https://www.in.gov/fssa/carefinder/files/CCLicensingMonthlyYTDReport.pdf;
Administration for Children and Families, Child Care and Development Fund Plan for State/Territory
Indiana, FFY 2025-2027, Certified on June 30, 2024.
Fiscal Analyst: Karen Rossen, 317-234-2106.
HB 1277 2